Suspension Response to Motion for Leave

DISTRICT OF COLUMBIACOURT OF APPEALS

In re MATTHEW LeFANDE 19-BG-421

RESPONSE TO MOTION FOR LEAVE

Attorney LeFande hereby replies to the Disciplinary Counsel's Motion for Leave,

Disciplinary Counsel now offering a drastically revised recital of the events involving

LeFande's participation in a real estate closing in Maryland. Disciplinary Counsel still

doesn't quite get the facts right, and again makes allegations that aren't supported by any

evidence whatsoever. Relying on documents produced by District Title in the District

Court litigation, it now asserts that “LeFande assisted Mr. Day in transferring funds

overseas before the district court issued the order enjoining Mr. Day from transferring or

dissipating assets - but after District Title moved for the preliminary injunction.” There

is no evidence whatsoever that LeFande “assisted Mr. Day in transferring funds

overseas”. There is only evidence that LeFande drove a dying client to an unrelated real

estate closing scheduled months earlier. District Title's own documents show that

LeFande had no part in the transfer of the funds, other than to allegedly convey his

client's wishes as to the disposition of the funds. District Title v. Warren, 14-cv-1808,

ECF Docket # 94-5.

The attached documents demonstrate that the Maryland property was contracted

for sale on September 19, 2014, at least five weeks before LeFande had made any

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appearance in the District Title case. The transaction was scheduled for closing on

October 30, 2014, but delayed when the buyer could not obtain sufficient financing for

the appraised value. The price was reduced, and the closing rescheduled. Four and a half

years later, LeFande has no independent recollection of the actual date he drove Day to

Baltimore, and can find no records thereof, but the preprinted date of November 20, 2014

listed on the documents fell on a weekend when the title company was unlikely open, and

not the same day as the actual closing. LeFande doesn't know the actual closing date, but

the parties were operating under a contract from months earlier, and Day was already

obligated at that point to timely consummate the transaction.

As thoroughly detailed in the attached court filings of Quicken Loans, the lender

for the buyer of the Maryland property, there was no legal encumbrance for Day's sale of

the property until weeks or months later. LeFande had no part in this defense of the

Maryland lawsuit, but the facts remain the same, there was nothing illegal whatsoever in

Day's sale of a property that had nothing to do with the District of Columbia litigation. It

was quite evident to any observer, including LeFande, that Day was close to death and he

was in the process of winding up his earthly affairs.

What is absolutely certain is, the funds transferred from the Maryland real estate

closing had no taint whatsoever of the District of Columbia transaction involving District

Title and had nothing to do with Anita Warren. District Title's demand for LeFande's

deposition was discovery in execution of Day's judgment after Day was long dead. The

District Court lost all jurisdiction to conduct such discovery upon Day's death, had no

authority to enter judgment against third parties, and there could be no suggestion of a

violation of any court order in the transaction. There was no lawful right to conduct the

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deposition by the District Court. Regardless of the ex post facto rationalization of the

Circuit Court, which itself sidesteps the issue of jurisdiction, the District Court acted

illegally, and LeFande was correct to refuse to take the stand. Years later, Day has never

been substituted as a party defendant and the District Court continues to violate its own

rules and statutory law by proceeding against Day in a matter that is solely under the

authority of a probate court.

When the District Court switched horses and attempted to illegally bypass the

probate rules regarding Day's judgment and use Warren to conduct discovery about Day,

LeFande properly sought protection for the indigent Warren in bankruptcy. The District

Court and District Title then both violated the automatic stay in bankruptcy and

proceeded anyway. The Bankruptcy Trustee's final report as attached demonstrates no

fraud or impropriety in Warren's bankruptcy. But for the fraudulent acts of District Title

employing a Personal Representative for Warren to negotiate a settlement with itself, this

case would be already fully administered and closed. It is a sad commentary on the

priorities of the Disciplinary Counsel for it to continue to attack LeFande for his

obviously lawful advocacy, when the remainder of this case is so absolutely permeated

with fraud and misconduct perpetrated by other parties.

CONCLUSION

For these reasons, and for such other reasons as this court finds to be good and

sufficient cause, Attorney Matthew LeFande should be immediately reinstated to the

practice of law and this matter closed.

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Respectfully submitted, this 18th day of June, 2019.

__________________________Matthew August LeFande1644 Sixth Street NWWashington DC 20001Tel: 202 657 [email protected]

CERTIFICATE OF SERVICE

I hereby certify that a true and complete copy of the foregoing Response was served uponinterested parties including disciplinary counsel via electronic filing this 18th day of June, 2019.

_______________________________ Matthew LeFande

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IN THE CIRCUIT COURT FOR SAINT MARY'S COUNTY, MARYLAND

DISTRICT TITLE, INC.,

Plaintiff,

v.

TIMOTHY DAY, et al.,

Defendants.

) ) ) ) ) ) ) ) )

Case No. 18-C-15-000820-ER

___________________________ ) MOTION OF DEFENDANTS MICHAEL LYON, QUICKEN LOANS INC.,

AND MORTGAGE ELECTRONIC REGISTRATION SYSTEMS, INC., TO DISMISS PLAINTIFF'S VERIFIED COMPLAINT

Defendants, Michael Lyon, Quicken Loans Inc., and Mortgage Electronic Registration

Systems, Inc. (collectively, "Moving Defendants"), by counsel, hereby submit their Motion to

Dismiss Plaintiffs Verified Complaint pursuant to Md. Rule 2-322(b)(2) for failure to state a

claim upon which relief can be granted. In support thereof, Moving Defendants incorporate the

accompanying Statement of Grounds and Authorities. A proposed Order is attached.

REQUEST FOR HEARING

Moving Defendants request a hearing on their Motion pursuant to Md. Rule '2-31l(f).

Respectfully submitted,

K. Stutzman . Hurwitz

hnA. Nader Stradley Ronon Stevens & Young, LLP 1250 Connecticut Ave., N.W., Suite 500 Washington, D.C. 20036 (202) 822-9611 (202) 822-0140 [email protected] [email protected] [email protected]

Counsel for Defendants Michael Lyon, Quicken Loans Inc., and Mortgage Electronic Registration Systems, Inc.

ATTORNEY CERTIFICATION OF ADMISSION

Pursuant to Maryland Rule 1-313, I hereby certify that I am a member of the Maryland

Bar, I am in good standing, and that I am authorized to practice law in the State of Maryland.

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CERTIFICATE OF SERVICE

I hereby certify that on August 19, 2015, I served a copy of the foregoing Motion to

Dismiss on:

David H. Cox, Esq. Timothy Day Brian W. Thompson, Esq. 3 Boston Drive Nathan J. Bresee, Esq. Berlin, MD 21811 Jackson & Campbell, P.C. 1120 20th Street, N.W. Defendant Washington, D.C. 20036

Counsel for Plaintiff, District Title, Inc.

Matthew Ashburn 1412 Morse Street, N .E. Washington, D.C. 20002

Defendant

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IN THE CIRCUIT COURT FOR SAINT MARY'S COUNTY, MARYLAND

DISTRICT TITLE, INC., ) ) ) ) ) ) ) ) )

Plaintiff,

v. Case No. 18-C-15-000820-ER

TIMOTHY DAY, et al.,

Defendants.

STATEMENT OF GROUNDS AND AUTHORITIES IN SUPPORT OF MOTION OF DEFENDANTS MICHAEL LYON, QUICKEN LOANS INC.,

AND MORTGAGE ELECTRONIC REGISTRATION SYSTEMS, INC. TO DISMISS PLAINTIFF'S VERIFIED COMPLAINT

Defendants Michael Lyon ("Lyon"), Quicken Loans Inc. ("Quicken Loans"), and

Mortgage Electronic Registration Systems, Inc. ("MERS") (collectively, "Moving Defendants"),

hereby submit this Statement of Grounds and Authorities in support of their Motion to Dismiss.

A proposed Order is attached.

I. INTRODUCTION

This case arises from a mistake made by Plaintiff, District Title, Inc. ("District Title"), in

wiring money to the wrong person. District Title has since commenced multiple civil actions to

attempt to rectify its own mistake and to recover the allegedly misdirected money, with this

action being the most recent. The claims now asserted against Moving Defendants, however, fail

as a matter of law.

District Title contends that Defendant, Timothy Day ("Day"), fraudulently conveyed the

property located at 12930 Point Lookout Road, Scotland, MD 20687 (the "Scotland Property"),

to Defendant Matthew Ashburn ("Ashburn"), for purposes of hindering, delaying or defrauding

District Title, an alleged creditor of Day's. Ashburn purchased the Scotland Property from Day

with the proceeds of a loan from Quicken Loans. The loan is secured by a deed of trust for

which Lyon is the trustee, and MERS is the named beneficiary as nominee for Quicken Loans,

its successors and assigns.

With respect to the Moving Defendants, District Title asserts three claims: Count I

(Fraudulent Conveyance); Count III (Declaratory Judgment); and Count V (Equitable Relief).

District Title seeks an order declaring that the sale of the Scotland Property from Day to Ashburn

was fraudulent and should be set aside; setting aside the deed of trust; awarding District Title

unspecified monetary damages, attorneys' fees and costs; and subordinating the deed of trust to

any judgment District Title may receive in this action.

District Title's Complaint fails to state a claim upon which relief may be granted against

Moving Defendants, and the Court should dismiss those claims pursuant to Rule 2-322(b). As

explained below, Quicken Loans was a bonafide purchaser for value, because as a matter of law,

it lacked either actual or constructive notice of the claims allegedly affecting title to the Scotland

Property. District Title's claims against Moving Defendants are foreclosed by the Court of

Appeals of Maryland's decision in Greenpoint Mortg. Funding, Inc. v. Schlossberg, 390 Md. 211

(2005). In short, District Title's failure to record and index a notice of lis pendens is fatal to its

claim that Moving Defendants had notice of Plaintiffs purported claims relating to the Scotland

Property. Second, the Complaint does not state a viable cause of action for fraudulent

conveyance against Moving Defendants under Maryland law. Finally, District Title presents no

valid reasons to set aside the deed of trust, or to subordinate it to any judgment District Title

could obtain. As such, District Title's claims against Moving Defendants fail as a matter of law,

and those claims should be dismissed with prejudice.

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II. FACTUAL AND PROCEDURAL HISTORY

As pertinent to this motion, District Title contends that on May 25, 1976, Anita K.

Warren ("Warren") and William Day, Jr. purchased property in the District of Columbia located

at 3205 7th Street, N.E. (the "D.C. Property"). (Compl. at~ 10.) On January 11, 2008, William

Day, Jr. obtained a $544,185.00 loan from Wells Fargo Bank, N.A. (the "Reverse Mortgage"),

secured by deeds of trust recorded against the D.C. Property in favor of Wells Fargo and the

Department of Housing and Urban Development. (I d. at ~~ 11-12.)

On December 22, 2012, William Day, Jr. allegedly died, and Anita K. Warren became

the sole owner of the D.C. Property. (Compl. at~ 13.) Warren then allegedly agreed to sell the

D.C. Property to a third-party, 3205 7th Street, LLC, for $500,000.00. (ld. at~ 14.)

On July 11, 2014, the closing for the sale of the D.C. Property was conducted by District

Title. (Compl. at~ 16.) District Title contends that at closing, it erroneously failed to include a

$293,514.44 line item in the settlement documents, which was intended to satisfy the Reverse

Mortgage loan, and which would then result in the release of the underlying deeds of trust. (Mh

at ~ 17.) Instead of paying off Wells Fargo, however, District Title instead mistakenly wired

$293,514.44 to an account held by Warren. (Mh)

District Title alleges that Warren and her son, Defendant Timothy Day, then conspired to

"convert" the misdirected funds from District Title for their own use. (Compl. at~~ 17 and 18.)

District Title contends that Day controlled Warren's financial affairs, and that at Day's direction,

Warren allegedly wired the converted funds into an account which Day controlled. (ld. at~~ 20

and 21.) According to District Title, rather than repaying it the $293,514.44, Day and Warren

instead used that money to purchase other Maryland properties, along with other personal items.

(Id. at~~ 22-25.)

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A series of lawsuits followed. First, on September 2, 2014, District Title filed an action

in the Superior Court of the District of Columbia against Day and Warren, asserting claims for

breach of contract and conversion (the "D.C. Litigation"). (Compl. at~ 27.) The D.C. Litigation

was subsequently removed to the United States District Court for the District of Columbia,

where it was assigned Case No. 1: 14-cv-1808. (ld.) The land records show that District Title

never filed a notice of lis pendens of the D.C. Litigation. On December 15, 2014, the federal

District Court entered a preliminary injunction order (the "Preliminary Injunction Order"),

against Day and Warren. Among other things, the Preliminary Injunction Order barred Day and

Warren from further use of the allegedly converted funds, and barring the transfer or sale of any

real property. (M:. at~ 30 and Ex. 13.) The Preliminary Injunction Order was recorded, but as

explained below, it was recorded after Quicken Loans obtained and recorded the deed of trust.

On November 5, 2014, District Title filed a Complaint for Injunction in this Court against

Day, titled District Title, Inc. v. Timothy Day, Case No. 18-C-14001637 (the "St. Mary's County

Litigation"). A true and correct copy of the complete case record of the St. Mary's County

Litigation is attached hereto as Exhibit "A"! In that action, District Title sought to enjoin Day

from disposing of any real property located in the county, including the Scotland Property. (Ex.

"A" at p. 14-16.) District Title also sought to establish an equitable lien against the Scotland

Property. (ld. at p. 16.) Again, the land records show that District Title never filed a notice of lis

pendens of the St. Mary's County Litigation. Ultimately, due to District Title's failure to timely

serve Day with process, this Court dismissed that action pursuant to Md. Rule 2-507(b) on April

24, 2015.

The Court may consider the pleadings from the St. Mary's County Litigation in considering this motion to dismiss. See Lerner v. Lerner Corp., 132 Md.App. 32, 40-41 (2000) (taking judicial notice of circuit court records in related litigation, and noting that Md. Rule 5-201 (b) permits a court to take judicial notice of facts that readily can be determined by examination of a source whose accuracy account be questioned, including "facts relating to the records of the court").

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Day became the record owner of the Scotland Property - the property at issue in this case

-back in 2008, by virtue of a June 18, 2008 deed from Warren to Day. A true and correct copy

of the June 18, 2008 deed is attached hereto as Exhibit "B. "2 Therefore, Day was the owner of

the Scotland Property before the dispute with District Title began in 2014. On November 20,

2014, Day sold the Scotland Property to Ashburn for $89,000.00. (Compl. at~ 38.) This was

before the court in the D.C. Litigation entered the Preliminary Injunction Order. (Id. at~ 31 and

Ex. 3.) Ashburn purchased the Scotland Property using the proceeds of a loan he obtained from

Quicken Loans. (M:. at~ 38.) The loan was secured by a deed of trust (the "Deed of Trust"), on

the Scotland Property, which named Lyon as the trustee, and MERS as the named beneficiary as

nominee for Quicken Loans, its successors and assigns. (Id. at~ 36.) A true and correct copy of

the Deed of Trust is attached hereto as Exhibit "C."

The timing and sequence of events is important to this motion. The Deed of Trust on the

Scotland Property was recorded in the land records for St. Mary's County on January 13, 2015.

(Compl. at~ 39.) District Title did not record the Preliminary Injunction Order from the D.C.

Litigation in the land records of St. Mary's County until January 23, 2015 -two months after the

sale of the Scotland Property, and ten days after the Deed of Trust was recorded. (ld. at~ 38.)

On June 17,2015, District Title filed this action. On August 19,2015, this Motion followed.

For the Court's reference, the pertinent chronology is as follows:

• June 18, 2008 - Day becomes the record owner of the Scotland Property;

• July 11, 2014 - District Title conducts the closing for the sale of the D.C. Property. District Title erroneously wires the funds intended to pay off Wells Fargo to Warren;

2 See Lerner, 132 Md.App at 40-431 (noting that Md. Rule 5-201 (b) permits a court to take judicial notice of facts that readily can be determined by examination of a source whose accuracy account be questioned, including "facts relating to the records of the court").

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• September 2, 2014 - District Title files the lawsuit that becomes the D.C. Litigation (no notice of lis pendens is filed);

• November 5, 2014 - District Title files the St. Mary's County Litigation (no notice of lis pendens is filed);

• November 20, 2014- Day sells the Scotland Property to Ashburn, and Ashburn signs the Deed of Trust in connection with the loan from Quicken Loans;

• December 15, 2014 - Court in the D.C. Litigation enters the Preliminary Injunction Order;

• January 13, 2015- Deed of Trust on the Scotland Property is recorded in the land records for St. Mary's County;

• January 23, 2015 -District Title records the Preliminary Injunction Order from the D.C. Litigation; and

• April25, 2015- The St. Mary's County Litigation is dismissed for lack of timely service pursuant to Md. Rule 2-507(b ).

III. LEGAL ARGUMENT

A. Standard of Review

A motion to dismiss is properly granted if a complaint does not disclose, on its face, a

legally sufficient cause of action. Md. Rule 2-322(b)(2); Allied Inv. Com. v. Jasen, 123

Md.App. 88, 96 (1998). A complaint fails to state a claim when, even if the allegations of the

complaint are true, the plaintiff nevertheless is not entitled to relief as a matter of law. Ricketts

v. Ricketts, 393 Md. 479, 491 (2006); Lubore v. RPM Associates, Inc., 109 Md.App. 312, 322

(1997), cert. denied, 343 Md. 565. When considering a motion to dismiss for failure to state a

claim, the court only examines the sufficiency of a pleading, and assumes the truth of all of the

well-pled facts in the complaint and attached exhibits, and the reasonable inferences drawn from

them. Lubore, 109 Md.App. at 322; and 120 West Fayette St., LLP v. Mayor and City Council

of Baltimore, 407 Md. 253, 261 (2009). A plaintiff, to withstand a motion to dismiss for failure

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to state a claim, must allege facts with specificity; "bald assertions and conclusory statements ...

will not suffice." Bobo v. State, 346 Md. 706,708-709 (1997).

B. Moving Defendants Are Protected Under The Bona Fide Purchaser Doctrine.

The claims asserted against Moving Defendants fail as a matter of law because Moving

Defendants are entitled to the protections of bona fide purchasers for value. Quicken Loans

gave value in the form of a loan to Ashburn, secured its interest in the Scotland Property through

the Deed of Trust, and it did so without notice knowledge of Day's alleged fraud or the then-

pending litigation. MERS and Lyon are also entitled to bona fide purchaser status because the

Moving Defendants are similarly situated relative to their respective interests in the Scotland

Property. MERS is Quicken Loans' nominee under the Deed of Trust, and therefore the secured

party on Quicken Loans' behalf. Lyon is the trustee named in the Deed of Trust. The property

interest implicated in this action affects all three Moving Defendants based on their respective

interests in the property as stated in the Deed of Trust.

It is a "well-settled principle that one who purchases real property without notice of prior

equities is protected as a bona fide purchaser for value." Frederick Ward Assocs. v. Venture.

Inc., 99 Md.App. 251, 256 (1994). In In rePeople's Banking Co. v. Fidelity & Deposit Co., 165

Md. 657 (1934), the Court of Appeals identified the essential elements of an "innocent

purchaser":

(a) That he [or she] must have given value for the property; (b) that he [or she] must have dealt in good faith with respect to the purchase; and (c) without notice or knowledge of any infirmity in the title of his [or her] vendor.

Id., 165 Md. at 664. Similarly, in Westpark, Inc. V. Seaton Land Co., 225 Md. 443 (1961), the

Court of Appeals stated:

[t]he general rule is that a purchaser of real estate takes subject to outstanding equitable interests in the property, which are enforceable against him [or her] to

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the same extent they are enforceable against the vendor, where the purchaser is not entitled to protection as a bona fide purchaser, and one who purchases the equitable title to real estate is not protected as a bona fide purchaser where he [or she] receives notice of a prior equity before he [or she] acquires the legal title; or where he [or she] receives notice before he [or she] has paid all or substantially all of the purchase price.

ld., 225 Md. at 450.

Lenders who secure their interest with a mortgage or deed of trust (as Quicken Loans did

here), are entitled to protections available to bona fide purchasers for value, where such lenders

were without notice of the mortgagor's allegedly fraudulent conduct. Washington Mut. Bank v.

Homan, 186 Md.App. 372, 390 (2009). In Silver v. Benson, 277 Md. 553 (1962), the Court of

Appeals observed that "a mortgagee not a party to the fraud is entitled to the protection afforded

a bona fide purchaser by a court of equity, to the extent of his [or her] interest." I d., 277 Md. at

560. See also Homan, 186 Md. at 392 (citing Life Sav. & Loan Assoc. of Am. v. Bryant, 125

Ill.App.3d 1012 (1984) ("A mortgagee of realty is regarded as a purchaser, and, if the mortgage

is supported by consideration and is taken in good faith, the mortgagee will be protected against

adverse claims of which it has no notice. Where, however, the mortgagee, at the time of taking

the mortgage, has knowledge or legal notice of a prior conveyance, it is not entitled to the

protection of a bona fide purchaser"); Blaise v. Ratliff, 672 S. W.2d 683, 688 (Mo. Ct. App.

1984) ("A bank that loans money to a customer and takes a Deed of Trust to secure that loan,

although technically speaking is not a bona fide purchaser for value because it purchases

nothing, is in effect an innocent purchaser for value as the result of its loan on the property. A

mortgagee of real property is regarded for some purposes as a purchaser and is entitled to the

same protection given a bonafide purchaser if it meets certain tests.")

Here, Quicken Loans gave value for the Deed of Trust by extending Ashburn a loan in

the amount of$89,100. (Compl. at~~ 37-38; and Ex. C.) As a result, the "value" requirement of

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the bona fide purchaser doctrine is easily satisfied. District Title does not allege otherwise in the

Complaint.

Instead, District Title appears to suggest that Moving Defendants had knowledge of the

dispute between District Title and Warren and Day. The Complaint does not allege that Moving

Defendants had "actual" knowledge of the dispute, any alleged fraud, or the impact on the

Scotland Property. Rather, District Title suggests that Moving Defendants had "constructive"

knowledge of the dispute by virtue of the St. Mary's County Litigation or the D.C. Litigation, to

which Moving Defendants were not even parties. (Compl. at~ 35.)

As explained below, any suggestion that Moving Defendants had constructive notice of

alleged fraud committed by Warren and Day, or the litigation purporting to cloud title to the

Scotland Property, fails as a matter of law. As the Court of Appeals held in Greenpoint, to

provide constructive notice of litigation affecting real property, a notice of lis pendens must be

recorded and indexed in the land records. ld., 390 Md. 211. Without recordation and indexing,

the mere filing of a complaint, without more, does not provide notice of a pending action. Mh,

390 Md. at 324-325. Because District Title did not record a lis pendens, Moving Defendants are

bonafide purchasers for value of the Scotland Property without notice of District Title's claims.

Accordingly, the Complaint against Moving Defendants must be dismissed with prejudice.

1. District T.itle's failure to record a lis pendens is fatal to its claims against moving defendants.

The crux of District Title's argument is that the mere filing of Complaints in the St.

Mary's and D.C. Litigation3 was enough to operate as a lis pendens of its claims against Warren

As explained more fully in §B(2) below, District Title cannot rely on litigation filed outside Maryland as somehow providing notice to Moving Defendants of a dispute over land in Maryland. See Rule 12-102 (stating that it applies only to "an action filed in a circuit court or in the United States District Court for the District of Maryland that affects title to or a leasehold interest in real property located in this State." ld. at§ 12-102(a) ("Scope").

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and Day. That argument fails as a matter of law because it is directly contrary to the controlling

decision of the Court of Appeals in Greenpoint. Because District Title failed to record a lis

pendens in connection with either the St. Mary's or D.C. Litigation, the Complaints filed in those

actions were not sufficient to operate as constructive notice to Moving Defendants.

In Greenpoint, the Court of Appeals held that a notice of lis pendens must be recorded

and indexed to effect constructive notice of claims against real property. ld., 390 Md. at 234-

235. Greenpoint had its origins in a divorce action in Washington County between Moses

Karkenny and Nahil Karkenny. Id. at 217. Receivers were appointed to preserve and liquidate

the Karkennys' properties in Prince George's and Montgomery County. Id. The receivers filed

notices of lis pendens in the Circuit Courts for Prince George's and Montgomery County, listing

the real property which was subject to the divorce proceeding. Id. The notices were accepted for

recording; however, the clerks failed to properly index them because they were indexed under

the wife's name, rather than the husband's. Id. at 218. After the notices were recorded but

indexed incorrectly, the husband encumbered two of the properties with deeds of trust which

secured loans from lenders. Id.

The receiver filed an action for declaratory relief against the husband and the lenders.

Greenpoint, 390 Md. at 218. The complaint included copies of the notices of lis pendens marked

"filed" by the court clerks. The lenders sought judgments in their favor due to the mis-indexed

notices of lis pendens. I d. at 219. The lenders argued that there was no way that they could have

learned of the notices if they were mis-indexed. Therefore, they argued that they lacked notice

of the wife's alleged interest in the properties, and that their deeds of trust were valid,

enforceable, and superior to the wife's claims. Id. at 220.

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The Circuit Court concluded that both deeds of trust were inferior in priority to the

receivership. Greenpoint, 390 Md. at 221. The court relied solely on the language of Md. Rule

12-1 02(b ), which states, in pertinent part, that "in any action to which the doctrine of lis pendens

applies, the filing of the complaint is constructive notice of the lis pendens as to real property in

the county in which the complaint is filed." The Circuit Court reasoned that the rule did not

require the recording and indexing of a notice of lis pendens to establish constructive notice. ld.

The lenders appealed, but before the Court of Special Appeals could consider the matter, the

Court of Appeals granted certiorari. ld. at 215.

The Court of Appeals reversed the Circuit Court, and concluded that the Circuit Court

erred in finding that mere filing of a notice of lis pendens pursuant to Rule 12-1 02(b) was

sufficient to put the lenders on constructive notice of the divorce action. I d. The Court also held

that the recorded but mis-indexed notices of lis pendens were a legal nullity because they were

incapable of providing notice. ld.

The Court's reasoning in Greenpoint is directly applicable to this case. The receiver

argued that because Rule 12-102 contains no express recording or indexing requirements, notice

of lis pendens is perfected through the mere filing with the court. The Court of Appeals

expressly rejected that argument. Instead, the Court concluded that the filing of notices of lis

pendens under Rule 12-102 must be read in conjunction with Maryland's recording and indexing

statutes. Greenpoint, 390 Md. at 229. Under Md. Code, Real Property, § 3-301(a), the clerk of

the Circuit Court is obligated to "record every deed and other instrument affecting property in

well-bound books to be named 'Land Records."' Id. at 228-29 (emphasis omitted) (citations

omitted). Further, under Md. Code, Real Property, §§ 3-302(a) the clerk must maintain a "full

and complete general alphabetical index of every deed, and other instrument." I d. at 229

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(emphasis omitted) (citations omitted). The Court held that if "any instrument affecting title to

real property" must be recorded in land records, then it also must be indexed. I d. (emphasis

omitted). As it relates to the filing of notices of lis pendens under Rule 12-102, the Court relied

on that rule's stated purpose of providing constructive notice of any action that "affects title to

... real property." ld. (citing Rule 12-102(a). As a consequence, the Court held that notices of

lis pendens must be recorded and indexed to provide constructive notice to the world of litigation

affecting real property. I d. As the Court stated:

adoption of Rule 12-102, and its language as to filing, must be considered in light ojthe requirements of the statutes and common law it was intended to facilitate, and thus must be read broadly as incorporating the indexing (and other) requirements of the various statutes.

Were the court to hold that because the rule does not contain a direct indexing requirement, it affords notice without indexing, we in effect, would overrule the statutory requirement that instruments affecting title must be indexed. Such an interpretation would change the statutory requirements for the placing of notices, i.e., instruments affecting title to real property in the land records of a county and that they be indexed.

Greenpoint, 390 Md. at 229-230 (emphasis added). The Court then made its holding clear:

"[t]oday, instruments affecting title, including notices of lis pendens are required to be

recorded and indexed- the indexing provisions require that any instrument in land records must

be indexed." Id. at 235 (emphasis added).

The Court also based its decision on the absurdity that would result if it held the other

way - if the mere filing of a lis pendens, without recording or indexing, were sufficient to

provide constructive notice under Rule 12-102. Without recording and correct indexing, a title

examination would be impossible. Rather, it would require a complete review of all public

records without a reference point- including Maryland's state and federal court dockets, and

judgment indexes, for any action or instrument which might affect title. Greenpoint, 390 Md. at

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236-237 ("The contrary position, i.e. indexing is not required, would result in millions of

documents having to be reviewed to certify a clear title. It would be an impossible task. . . .

Everything depends on indexing. Without indexing nothing works.").

In light of the Court's holding and reasoning in Greenooint, District Title's claims against

Moving Defendants fail as a matter of law. District Title relies on only the filing of the

Complaints in the St. Mary's County and D.C. Litigation to argue that Moving Defendants had

constructive knowledge of the dispute over the Scotland Property. That reasoning was rejected

by Greenpoint. Rather, constructive notice under Rule 12-102 is conditioned on the proper

recordation and indexing of a notice of lis pendens. Greenpoint, 390 Md. at 235. District Title

failed to comply with this requirement. District Title does not allege that it recorded and indexed

notices of lis pendens- or even copies of the Complaints from the St. Mary's County and D.C.

Litigation- in the land records of St. Mary's County. Indeed, the land records for the Scotland

Property confirm that no such notice was recorded and indexed. A true and correct copy of the

complete land records for the Scotland Property are attached hereto as Exhibit D.4 Accordingly,

whether indexed under Day, Ashburn, or District Title, there is no record of a notice of lis

pendens (with the exception of the Preliminary Injunction Order, which is irrelevant for purposes

of providing constructive notice, a discussed in below § B.2, below). A true and correct copy of

aforementioned search results are attached hereto as Exhibit E.5 Because District Title failed to

record and index the Complaints from St. Mary's County and D.C. Litigation, Moving

Defendants did not have constructive notice of those actions, and there is no allegation that

Moving Defendants had actual notice.

See Lerner, 132 Md.App. at 40-41 (2000) (providing for judicial notice under Md. Rule 5-201 (b) relating to facts that readily can be determined by examination of a source whose accuracy account be questioned, including "facts relating to the records of the court," such as land records).

- 13-

Nothing in Fishman v. Murohy ex rei. Estate of Urban, 433 Md. 534 (2013), requires a

different result. Although the Court in Fishman concluded that a lender could not be a bona fide

purchaser if it had constructive notice of a complaint pertaining to land, nothing in Fishman

overturned or distinguished Greenpoint. Greenpoint still stands for the proposition that a lis

pendens must be properly recorded and indexed to provide constructive notice. That issue was

not discussed in Fishman - there was no argument on the issue of whether the underlying

complaint was recorded and indexed. In fact, the opinions from both the Court of Special

Appeals and the Court of Appeals suggest that the complaint was properly recorded. See

Fishman, 207 Md.App. at 297 ("[the Estate] contends that the Lender would have gained notice

of the existence of the Estate Lawsuit by the title search conducted before settlement or

recordation of the []deed of trust ... and, that the lender had ... at a minimum, inquiry notice of

the matter"); Fishman, 433 Md. at 556-557 (noting that perhaps, the lender should have

investigated the land records more thoroughly before closing on the loan).

Further, Moving Defendants are not arguing that constructive notice under Rule 12-102

can never apply to bona fide purchasers, which was the issue in Fishman. Rather, the issue in

this case is how that notice must be perfected. Under Greenpoint, to perfect constructive notice

under Rule 12-102, a notice of lis pendens must be properly recorded and indexed. I d., 340 Md.

at 229-230. Because that did not happen here, there is no merit. to District Title's argument that

Moving Defendants had notice under Rule 12-102. As a result, Moving Defendants were bona

fide purchaser for value, and the claims against them must be dismissed with prejudice.

- 14-

2. Moving Defendants did not have actual or constructive knowledge of the Preliminary Injunction Order prior to the sale of the Scotland Property.

District Title also suggests that Moving Defendants had notice of the Preliminary

Injunction Order from the D.C. Litigation, but the allegations of the Complaint demonstrate that

this is false. The Property was sold to Ashburn on November 20, 2014. (Compl. at~ 38.)

Plaintiff admits that the Preliminary Injunction Order was issued by the federal district court in

the D.C. Litigation on December 15, 2015. (Id. at ~ 30 and Ex. 13.) District Title further

concedes that it waited until January 23, 2015 to record the Preliminary Injunction Order in the

land records of St. Mary's County. ffih at~ 36.) Therefore, Moving Defendants could not have

had notice of the Preliminary Injunction Order before the sale of the Scotland Property. Because

the Preliminary Injunction Order was not recorded and indexed before the Deed of Trust, it has

no effect on Moving Defendants' status as bonafide purchasers for value.

In fact, neither District Title's amended complaint, nor its motion for preliminary

injunction, in the D.C. Litigation expressly referred to the Scotland Property. True and correct

copies of District Title's amended complaint, and its motion for preliminary injunction (without

accompanying exhibits) are attached hereto as Exhibit "F" and "G". As recognized by the Court

of Appeals in Greenpoint, the doctrine of lis pendens applies only to a proceeding directly

relating to the thing or property in question. Id., 390 Md. at 223 (quoting Fiegley v. Fiegly, 7

Md. 537, 556 (1855) ("[t]he principle of lis pendens is that the specific property must be so

pointed out by the proceedings as to warn the whole world that they meddle with it at their

peril"). Nothing in the D.C. Litigation suggested that the Scotland Property was the object of or

implicated in that action.

- 15-

Finally, by its express terms, Rule 12-102 does not apply to actions initiated outside the

State of Maryland. Rather, that rule applies only to "an action filed in a circuit court or in the

United States District Court for the District of Maryland that affects title to or a leasehold interest

in real property located in this State." Id. at § 12-102(a) ("Scope"). The D.C. Litigation was

filed outside of the State of Maryland; therefore, Rule 12-102 has no application. A finding to

the contrary would effectively create a rule that a party seeking to acquire an interest in land

must search civil dockets in every state court, and every federal district of the United States, to

look for actions that could potentially affect an interest in land in Maryland.

Accordingly, the Complaint fails as a matter of law against Moving Defendants, and

should be dismissed with prejudice.

C. The Complaint Fails To State A Cognizable Claim Against Moving Defendants Under The Maryland Uniform Fraudulent Conveyance Act.

Not only are Moving Defendants protected as bona fide purchasers for value, each of the

claims asserted against them fails on its merits.

In Count I, District Title purports to assert a claim against Moving Defendants based on

the Maryland Uniform Fraudulent Conveyance Act, (Md. Code, Comm. Law, 15-201, et seq.)

(the "MUFCA"). Count I fails as a matter of law. There are no bases alleged in the Complaint

to support the conclusion that the sale of the Scotland Property by Day to Ashburn was

fraudulent, or intended to hinder, delay, or defraud Day's purported creditor, District Title.

Moreover, even if Day were District Title's supposed debtor (which, based on the facts alleged,

he is not), Ashburn gave fair value in consideration for the purchase of the Scotland Property.

The claim against Moving Defendants is then even more attenuated - Quicken Loans is even

further removed from the chain of events, and gave fair consideration for the Deed of Trust

through a loan to Ashburn.

- 16-

To state a claim under the MUFCA, a creditor must show that a conveyance was made

without fair consideration and either: (i) was committed by a person or entity who is or will be

rendered insolvent by the conveyance (Md. Code, Comm. Law,§ 15-204) (ii) was committed by

a person or entity engaged or about to be engaged in a business or transaction for which the

property remaining in his hands after the conveyance is an unreasonably small capital (ill:. at §

15-206), or (iii) was committed by a person or entity who intends to or believes that he will incur

debts beyond his ability to pay when he undertakes the conveyance. (Id. at § 15-205). See also

In re Rood, 482 B.R. 132, 142-143 (D.Md. 2012), aff'd 532 Fed.Appx. 370, (4th Cir. 2013), aff'd

533 Fed.Appx. 228 (4th Cir. 2013). The MUFCA also imposes liability for conveyances made

with actual intent to hinder, delay, or defraud present or future creditors, regardless of whether

there was fair consideration for the transfer. Md. Code, Comm. Law, § 15-207. The only

remedies available under MUFCA are that the creditor may seek to set aside the conveyance or

levy or garnish the property transferred by the conveyance. See ld. at § 15-209; and Frain v.

~ 92 Md.App. 605, 620 n. 7 (1992), cert. denied, 328 Md. 237 (1992) ("under Maryland

law, once a conveyance is proven to be fraudulent, a creditor has the option of either having the

conveyance set aside or attaching the property conveyed").

The Complaint does not appear to assert claims for fraudulent conveyances under§§ 12-

204, 12-205 or 12-206 of the MUFCA. (Compl. at~ 44-53.) Instead, District Title alleges that

the sale of the Scotland Property by Day to Ashburn was a fraudulent conveyance because (i)

Ashburn and the Moving Defendants allegedly had actual or constructive knowledge of the D.C.

Litigation and the St. Mary's County Litigation; (ii) Day intended to hinder, delay or defraud

District Title; and (iii) the consideration paid by Ashburn was allegedly below the actual value of

- 17-

the Scotland Property. (Compl. at,~ 48-49.) None of these arguments supports a fraudulent

conveyance claim against Moving Defendants.

First, as explained above, neither by November 5, 2014 (the filing of the St. Mary's

County Litigation), nor by November 20, 2014 (the sale of the Scotland Property), was District

Title a creditor of Day. Instead, District Title alleges that Warren, Day's mother, was

inadvertently wired the funds intended for Wells Fargo. (Compl. at, 17.) District Title admits

that it was not until December 15, 2014, that Day was under any order enjoining him from

conveying any property, or using any personal funds. Therefore, at the time of the sale of the

Scotland Property from Day to Warrant, District Title was not Day's creditor, nor was Day

subject to any court order as it pertains to the Scotland Property.

District Title also contends that the consideration paid by Ashburn for the Scotland

Property (based on loan proceeds from Quicken Loans), was "far below the actual value of the

Property." (Compl. at ~ 51.) The Complaint contains no factual basis to support this conclusory

allegation, and as such, it cannot withstand this Motion to Dismiss. See Bobo, 346 Md. at 708-

709 (in ruling on a motion to dismiss, "bald assertions and conclusory statements . . . will not

suffice"). More importantly, mere inadequacy of price, without other circumstances, is not

sufficient to establish fraud which would invalidate a conveyance as against creditors. See Fuller

v. J.B. Brewster & Co., 53 Md. 35, 36 (1880) ("It may be easy to say as a matter of law, what

disparity between the real value of the property and the consideration set forth in the deed shall

constitute an inadequacy of consideration. This must depend upon the facts and circumstances

of each particular case. We may safely say, however, that to justify the inference of fraud, the

disparity must be so glaring as to satisfy the court tllat the conveyance was not made in good

faith.") (citations omitted) (emphasis added); City of Baltimore v. Williams, 6 Md. 235, 271

- 18-

(1854) (finding that inadequacy of price is only a circumstance to be considered in connection

with other proof); and Drurv v. State Capital Bank of Easter Short Trust Co., 163 Md. 84 (1932)

("mere disparity between the real value of the property conveyed and the consideration does not

constitute an inadequacy of consideration that would require the deed to be set aside, but, in

equity, it would remain as security for the consideration to protect a bona fide grantee"). The

Complaint lacks any basis to conclude that the $89,000.00 price was not fair consideration.

District Title also claims that Ashburn had actual or constructive knowledge of the St.

Mary's County Litigation and the D.C. Litigation, and therefore, he did or should have known

that Day was intending to defraud his District Title through the sale. (Compl. at~ 49.) First, this

allegation is not based any well-pleaded facts which might otherwise cause the Complaint to

survive a motion to dismiss. See Bobo, 346 Md. at 708-709. Instead, District Title couches this

conclusion as fact by contending that Ashburn and Day were friends (ill. at ~ 40), and that a

company allegedly controlled by Ashburn was represented by an attorney who represents Warren

and Day in the D.C. Litigation. (Id. at~ 41.) None of those factors alone or taken together,

support the conclusion that the sale of the Property was done with actual intent to hinder or delay

District Title.

Moreover, Plaintiff does not allege that Ashburn also shared Day's intent to defraud

District Title. Without an intention to defraud on the part of both Day (the grantor), and Ashburn

(the grantee), the Complaint does not state a viable claim for fraudulent conveyance under

Maryland law. See Berger v. Hi-Gear Tire & Auto Supply, Inc. 257 Md. 470, 475 (1970)

("[ e ]ven if the grantor has a fraudulent intent, this will not vitiate or impair a conveyance unless

the grantee participates in the fraudulent intent') (emphasis added) (citing Long v. Dixon, 201

Md. 321, 323 (1953); Kennard v. Elkton Banking and Trust Co., 176 Md. 499, 503 (1939); and

- 19-

McCauley v. Shockey, 105 Md. 641, 645 (1907)). There is certainly no allegation that Moving

Defendants- effectively, grantees of the Deed of Trust- shared in any fraudulent intent.

Finally, District Title's contention that Moving Defendants had constructive knowledge

of the St. Mary's County Litigation or the D.C. Litigation- and thus, Day's intent to hinder,

delay or defraud District Title - fails as a matter of law for all the reason stated above. District

Title also does not and cannot plausibly allege that the Moving Defendants shared Day's

allegedly fraudulent intent, which is required to support a fraudulent conveyance claim under

Maryland law. Long, 201 Md. at 323.

In sum, District Title's claims against Moving Defendants stretch well beyond the limits

of cognizable fraudulent conveyance claims under Maryland law. Moving Defendants are

entirely too removed from the underlying alleged fraud committed by Warren and Day to fall

within the scope of a claim for fraudulent conveyance. Accordingly, Count I for fraudulent

conveyance must be dismissed with prejudice.

D. Because The Complaint States No Cognizable Claim To Set Aside The Sale Of The Scotland Property, There Is No Basis For The Boot-Strap Claims For Declaratory Judgment (Count liD and Equitable Relief (Count Yl·

In Count Ill, District Title purports to state a claim for declaratory relief in the form of a

first priority lien against the Scotland Property. (Compl. at~~ 64-65.) In Count V, District Title

demands an equitable lien against the Scotland Property, and "whatever equitable relief' the

Court may grant. (Id. at~ 79.) These claims are nothing more than conclusions of law. Neither

states any valid reason to invalidate the sale of the Scotland Property, or to subordinate the Deed

of Trust.

First, District Title is not entitled to a first priority because it does not have any judgment

against Day, Warren, or Ashburn which might take the form of a lien against the Scotland

-20-

Property. Further, Quicken Loans is a bonafide purchaser for value, for all the reasons set forth

above. Second, there is no merit to District Title's claims for an "equitable lien." To

demonstrate the right to an equitable lien under Maryland law, a "specific intent to create a lien

must be made manifest, as, for instance, where a written instrument evidences an intent to create

a lien but the instrument is imperfect in some regard .... " Equitable Trust Co. v. Imbesi, 287

Md. 249, 260 (1980) (surveying the circumstances under which equitable liens were found to

exist). In contrast, an equitable lien could not apply here because there is nothing evidencing an

intent between District Title, Day, or Ashburn to create an encumbrance on the Scotland

Property. Finally, District Title would have Moving Defendants suffer a loss on account of

District Title's own negligence and its failure to properly wire funds to satisfy Wells Fargo's

deed of trust. The doctrine of unclean hands would bar such a result, as District. Title's own

conduct is the source of its purported equitable claim. See Adams v. Manown, 328 Md. 463,476

("[i]t is only when plaintiff's improper conduct is the source, or part of the source, of his

equitable claim, that he is to be barred because of this conduct") (citations omitted).

IV. CONCLUSION

For all the foregoing reasons, Michael Lyons, Quicken Loans Inc. and Mortgage

Electronic Registration Systems, Inc. respectfully request the entry of an Order: (a) granting their

Motion; (b) dismissing Plaintiffs Verified Complaint; and (c) granting such other and further

relief in their favor as this Court deems necessary and just.

-21-

'f'...., I

Respectfully submitted,

M. Hurwitz ohnA. Nader

Stradley Ronon Stevens & Young, LLP 1250 Connecticut Ave., N. W ., Suite 500 Washington, D.C. 20036 (202) 822-9611 (202) 822-0140 [email protected] [email protected] [email protected]

Counsel for Defendants, Michael Lyon, Quicken Loans Inc., and Mortgage Electronic Registration Systems, Inc.

-22-

Subject: Ac vity in Case 1:14‐cv‐01808‐ABJ‐DAR DISTRICT TITLE v. WARREN et al Order on Mo on for

Extension of Time to

From: DCD_ECFNo [email protected]

Date: 6/7/2019, 11:19 AM

To: DCD_ECFNo [email protected]

This is an automa c e‐mail message generated by the CM/ECF system. Please DO NOT RESPOND to

this e‐mail because the mail box is una ended.

***NOTE TO PUBLIC ACCESS USERS*** Judicial Conference of the United States policy permits

a orneys of record and par es in a case (including pro se li gants) to receive one free electronic

copy of all documents filed electronically, if receipt is required by law or directed by the filer. PACER

access fees apply to all other users. To avoid later charges, download a copy of each document

during this first viewing. However, if the referenced document is a transcript, the free copy and 30

page limit do not apply.

U.S. District Court

District of Columbia

Notice of Electronic Filing

The following transac on was entered on 6/7/2019 at 11:19 AM and filed on 6/7/2019

Case Name: DISTRICT TITLE v. WARREN et al

Case Number: 1:14‐cv‐01808‐ABJ‐DAR

Filer:

WARNING: CASE CLOSED on 11/16/2015

Document Number:No document a ached

Docket Text:MINUTE ORDER granting [147] Motion for Extension of Time. The Court finds thatthere is good cause to grant District Title an extension to allow it to substitute a partyfor defendant Timothy Day by August 2, 2019. SO ORDERED. Signed by Judge AmyBerman Jackson on 06/07/2019. (lcabj3)

1:14‐cv‐01808‐ABJ‐DAR No ce has been electronically mailed to:

Horace L. Bradshaw, Jr [email protected], [email protected]

David Howard Cox [email protected], [email protected]

Ma hew August LeFande ma @lefande.com

Brian Wood Thompson [email protected], [email protected],

ActivityinCase1:14‐cv‐01808‐ABJ‐DARDISTRICTTITLEv.WARREN...

1of2 6/19/2019,5:26AM

[email protected]

1:14‐cv‐01808‐ABJ‐DAR No ce will be delivered by other means to::

ActivityinCase1:14‐cv‐01808‐ABJ‐DARDISTRICTTITLEv.WARREN...

2of2 6/19/2019,5:26AM

Subject: 17‐22544 Chapter 7 Trustee's Report of No Distribu on ‐ CH7 ‐ Anita K. Warren

From: [email protected]

Date: 6/4/2019, 12:08 PM

To: [email protected]

***NOTE TO PUBLIC ACCESS USERS*** Judicial Conference of the United States policy permits

a orneys of record and par es in a case (including pro se li gants) to receive one free electronic

copy of all documents filed electronically, if receipt is required by law or directed by the filer. PACER

access fees apply to all other users. To avoid later charges, download a copy of each document

during this first viewing. However, if the referenced document is a transcript, the free copy and 30‐

page limit do not apply.

U.S. Bankruptcy Court

District of Maryland

No ce of Electronic Filing

The following transac on was received from Cheryl E. Rose entered on 6/4/2019 at 12:08 PM EDT and

filed on 6/4/2019

Case Name: Anita K. Warren

Case Number: 17‐22544

Document Number:113

Docket Text:

Chapter 7 Trustee's Report of No Distribu on: I, Cheryl E. Rose, having been appointed trustee of the

estate of the above‐named debtor(s), report that I have neither received any property nor paid any

money on account of this estate; that I have made a diligent inquiry into the financial affairs of the

debtor(s) and the loca on of the property belonging to the estate; and that there is no property

available for distribu on from the estate over and above that exempted by law. Pursuant to Fed R

Bank P 5009, I hereby cer fy that the estate of the above‐named debtor(s) has been fully

administered. I request that I be discharged from any further du es as trustee. Key informa on about

this case as reported in schedules filed by the debtor(s) or otherwise found in the case record: This

case was pending for 21 months. Assets Abandoned (without deduc ng any secured claims): $0.00,

Assets Exempt: $2980.00, Claims Scheduled: $314888.44, Claims Asserted: Not Applicable, Claims

scheduled to be discharged without payment (without deduc ng the value of collateral or debts

excepted from discharge): $314888.44. Filed by Cheryl E. Rose. (Rose, Cheryl)

The following document(s) are associated with this transac on:

17‐22544 No ce will be electronically mailed to:

David H. Cox [email protected],

17‐22544Chapter7Trustee'sReportofNoDistribution‐CH7‐Anita...

1of3 6/19/2019,5:18AM

[email protected]


[email protected]


[email protected]


[email protected]


[email protected]

Ma hew August LeFande ma @lefande.com

Cheryl E. Rose [email protected],

[email protected]

Cheryl E. Rose [email protected],

[email protected]

Brian W Thompson [email protected]

Brian W Thompson [email protected]

17‐22544 No ce will not be electronically mailed to:

Debtor(s): Anita K. Warren

Ma hew August LeFande

A orney at Law PLLC

1644 Sixth Street NW

Washington, DC 20001

Cheryl E. Rose on behalf of Trustee Cheryl E. Rose

Rose & Associates, LLC

9812 Falls Road

#114‐334

Potomac, MD 20854

Synchrony Bank

c/o PRA Receivables

Management, LLC

PO Box 41021

Norfolk, VA 23541


2of3 6/19/2019,5:18AM

Anita K. Warren

21895 Pegg Road

Unit 211

Lexington Park, MD 20653


3of3 6/19/2019,5:18AM

I]NITED STATES BANKRUPTCY COURTFOR THE DISTRICT OF MARYLANI)

(GREENBELT DTVISTON)

In re ANIITA K. WARREN,Case No. 17-22544 - WILChapter 7

DISTRTCT TrrLE,

Plaintiff Creditor, Case No. 0:17-ap-00508

v

SAMUEL C. P. BALDWIN, JR,PERSONAL REPRESENTATIVE OF THEESTATE OF AI{ITA K. WARREN,

Defendant Debtor

STIPULATION FOR ENTRY OF JUDGMENT OF NON.DISCHARGEABILITY A}{DCONSENT TO JUDGMENT

Plaintiff Creditor District Title, a Corporation ("Plaintiff Creditor" and/or "District

Title"), through undersigned counsel, and Defendant Debtor Samuel C. P. Baldwin, Jr., the

Personal Representative of the Estate of Anita K. Warren ("Defendant Debtor") hereby stipulate

14254072v.1

Case 17-22544 Doc 112 Filed 06/03/19 Page 1 of 6

and consent to a judgment of nondischargeability being entered against Defendant Debtor in this

matter as follows:

WHEREAS, Anita K. Warren filed a Petition for Chapter 7 Bankruptcy, currently

pending in this Court as Case No. 17-22544 on September 19,20L7; and

WHEREAS, Anita K. Warren died on or about March 29,2078;and

WHEREAS, Samuel C. P. Baldwin, Jr, was appointed as Personal Represe,ntative of the

Estate of Anita K. Warren in the St. Mary's County, Maryland proceeding known as Estate No.

t9062 on Novernber 27,2018, and was substituted as Defendant Debtor in this adversary

proceeding on January 25,2019; and

WHEREAS, PlaintiffCreditor is a judgment creditor of Defendant Debtor by reason of a

judgment entered in on November 13, 2015 in Case No. I :14-cv-01808-ABJ in the United States

District Court for the District of Columbia against Defendant Debtor in the amount of

$293,514.44, plus interest pursuant to said Judgment and attorneys' fees and costs in the amount

of $18,694.00 as awarded in the Memorandum Opinion and Order docketed May2,2016; and

WHEREAS, Plaintiff Creditor's filed its Claim on March 27, 2018 in Bankruptcy Case

No. 17-22544;and

WHEREAS, Plaintiff Creditor filed a Complaint to Establish Nondischargeability of

Debt and Objection to Discharge on December 22,2017 against Defendant Debtor seeking, inter

alia, an Order declaring that Plaintiff Creditor's judgment award against Defendant Debtor

entered in Case No. 1:14-cv-01808-ABJ in theUnited States District Court fortheDistict of

Columbia is nondischargeable in bankruptcy pursuant to 11 U.S.C. $523(a)(2XA) and/or 11

U.S.C. $s23(aX6); and

2


WHEREAS, Plaintiff Creditor filed an Amended Complaint on May 9, 2018 seeking,

inter alia, an Order declaring that Plaintiff Creditor's judgment against Defendant Debtor

entered in Case No. 1:14-cv-01808-ABJ in the United States Disfrict Court for the Distict of

Columbia is nondischargeable in bankruptcy pursuant to 11 U.S.C. $523(aX6); and

WHEREAS, the Personal Representative of Defendant Debtor's Estate has thoroughly

reviewed and examined the merits and claims set fo*h in the Amended Complaint filed by

PlaintiffCreditor; and

WHEREAS, the Personal Representative of Defendant Debtor's Estate believes that the

claims set forth in the Amended Complaint filed by Plaintiff Creditor are meritorious and that

further litigation of those claims will not result in any benefit to the Defendant Debtor's Estate;

and

WHEREAS, the Parties agree that the actions taken by Defendant Debtor as described in

the Amended Complaint support the finding that the Plaintiff Creditor's Judgment against

Defendant Debtor is nondischargeable pursuant to 11 U.S.C. $523(a)(6); and

WHEREAS, this Court has subject matter jurisdiction over this action pursuant to 28

U.S.C. $157 and 1334, and l1 U.S.C. $523; and

WHEREAS, venue before this Court is proper; and

WHEREAS, this Adversary Proceeding is a core proceeding pursuant to 28 U.S.C.

$1s7(bX2XI), and

WHEREAS, the Personal Representative of the Estate of Defendant Debtor hereby

consents to an entry ofjudgment in favor of PlaintiffCreditor,

NOW THEREFORE, the Court finds that:

I . Defendant Debtor did willfully and maliciously injure Plaintiff Creditor by breaching

3


her contract with PlaintiffCreditor accompanied by tortious conduot. Defendant Debtor acted in

concert with her son, Timothy Day, to transfer funds that she knew had been received from

Plaintiff Creditor in error. Defendant Debtor did convert funds in which she had no right,

interest, or ownership to her own use. In rurdertaking those actions, Defendant Debtor did

willfu lly and maliciously inj ure Plaintiff Creditor.

2. Defendant Debtor's actions resulted in, and were, willfrrl and malicious injury to

Plaintiff Creditor as would be subject to 1l U.S.C. $523(aX6). Therefore, Plaintiff Creditor's

judgment is nondischargeable pursuant to 11 U.S.C. $523(aX6).

3. Judgment be and is hereby entered in favor of PlaintiffCreditor and against the

Defendant Debtor, determining that the Plaintiff Creditor's judgment entered in on November

t3, 2075 in Case No. 1 : l4-ov-01 808-ABJ in the United States District Court for the District of

Columbia against Defendant Debtor in the amowrt of $293,514.44, plus interest pursuant to said

Judgment, and attorneys' fees and costs in the amount of $18,694.00, as awarded in the

Mernorandum Opinion and Order docketed May 2,2016, the amount of both being subject to

adjustnrent as may be necessary, ff€ nondischargeable in banlauptcy pursuant to 11 U.S.C.

$s23(a)(6); and

4. The claim filed by PlaintiffCreditor shall be nondischargeable by Defendant Debtor

in this case and in any case hereafter filed by Defendant Debtor.

5. Said judgment shall be ent€red forthwith and as a final disposition of this Adversary

Proceeding.

4


APPROVED AS TO FORM AND CONTENT:

David H. Cox, Esquire(U.S.D.C. Maryland Bar #01 994)Brian W. Thompson, Esquire(U.S.D.C. Maryland Bar #20366)JACKSON & CAMPBELL, P.C.n20 2O{" Street, NW, South Tower, Ste. 300Washington" DC 20036(202) 4s7-1600(202) 4s7-r678 (fax)

dcaxfgli.?.c,kscan$LgomCounselfor Creditor District Title, Inc.

Samuel C. P. Jr.PersonalAnitaK.

of the Estate of

(u Bar #05448)22335 Exploration DriveSuite 2030Lexington Parlq MD 20653(301)862-4400sbaldwin@baldwinbri sco e. comPR Estate of Anita K l{arren

5


CERTIFICATE OF' SERVICE

I hereby certify that, on June 3, 2019, a true and correct copy of the foregoing was served

on all parties listed below by EFC and first-class U.S. Mail.

Samuel C. P. Baldwin, Jr.

PR Estate of Anita K. Wanen22335 Exploration Drive, #2030Lexington Park, MD 20653

Cheryl E. Rose, Chapter 7 Trustee9812 Falls Road, #ll4-334Potomac, MD 20854

/s/ David H. CoxDavid H. Cox

6


Suspension Response to Motion for Leave

Documents

Transcript of Suspension Response to Motion for Leave